Cowabunga System Daily Update: 10/01/07

If this is your first time visiting this blog, read this first!

Main Trend

Current Trend= The trend remained up the entire day.

Today I only looked for long trades.

Today’s Surf

9:00am ET- There was a moving average crossover for a long trade. RSI was greater than 50, stochastics were trending up, but MACD was already positive. This cancelled out the signal and I did not enter. No trade!

Trade Result: +0 pips

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  • PIPCIOUS

    hey i have a hard time knowing when the longterm trend has changed direction 4 hr chart for example at what point do you decide that i will go for longs and when to go for shorts. when you say the trend remained up how do you conclude that??

  • PIPCIOUS

    hey i have a hard time knowing when the longterm trend has changed direction 4 hr chart for example at what point do you decide that i will go for longs and when to go for shorts. when you say the trend remained up how do you conclude that??

  • Brain2000

    First, I want to thank Big Pippin and Pip Surfer for putting this blog together. It was really helpful to find the next step after spending hundreds of hours reading, going through the classes, trying out pretend trading on several sites, etc…

    So tonight I decided to try and put in my first trade based on this system. I want to post when I made an entry point, and how I came to that conclusion to see if I read the charts correctly.

    On October 2nd at 12:54AM EST, I entered into a long trade on GBP/USD.

    Here was my synopsis:

    Looking at the 4 hour trend, while the immediate trend looks to be going slightly down, the longer trend is much stronger going up. So I am choosing to go long, slightly against the immediate trend, but well with the longer trend.

    Looking at the 15 minute chart, it looks like a possible buy signal at OCT 2nd 12:59AM. The MACD is beginning to go up, the Stochastics is heading up, the RSI is touching 50, and the 5 day is on the 10 day and looks like it will cross.

    So I entered a buy at 12:59AM with the sl at 2.0407 and tp at 2.0440.

    Please let me know if I have read the charts properly, as the Cowabunga system goes.

  • soap3000

    Big Pipin – thanks for the blog… it’s great.

    got an issue though – I’ve been following your strategy and often my indicators draw differently from yours…

    I use esignal, metatrader and have reuters running and they all line up but in today’s surf for example all my MACD’s are negtive and getting smaller so… a valid entry? why does yours draw differently?

    Can I triple check the settings please?
    Fast EMA 12
    Slow EMA 26
    MACD SMA 9
    applied to close

    many thanks – SOAP

  • Brain2000

    First, I want to thank Big Pippin and Pip Surfer for putting this blog together. It was really helpful to find the next step after spending hundreds of hours reading, going through the classes, trying out pretend trading on several sites, etc…

    So tonight I decided to try and put in my first trade based on this system. I want to post when I made an entry point, and how I came to that conclusion to see if I read the charts correctly.

    On October 2nd at 12:54AM EST, I entered into a long trade on GBP/USD.

    Here was my synopsis:

    Looking at the 4 hour trend, while the immediate trend looks to be going slightly down, the longer trend is much stronger going up. So I am choosing to go long, slightly against the immediate trend, but well with the longer trend.

    Looking at the 15 minute chart, it looks like a possible buy signal at OCT 2nd 12:59AM. The MACD is beginning to go up, the Stochastics is heading up, the RSI is touching 50, and the 5 day is on the 10 day and looks like it will cross.

    So I entered a buy at 12:59AM with the sl at 2.0407 and tp at 2.0440.

    Please let me know if I have read the charts properly, as the Cowabunga system goes.

  • soap3000

    Big Pipin – thanks for the blog… it’s great.

    got an issue though – I’ve been following your strategy and often my indicators draw differently from yours…

    I use esignal, metatrader and have reuters running and they all line up but in today’s surf for example all my MACD’s are negtive and getting smaller so… a valid entry? why does yours draw differently?

    Can I triple check the settings please?
    Fast EMA 12
    Slow EMA 26
    MACD SMA 9
    applied to close

    many thanks – SOAP

  • ChowClown

    Hi Pip Surfer, from your commentary you appear to scale out of profitable trades around the target zones, depending on whether price makes a clean break through the level, or not.

    What percentage of your ‘stake’ do you take off usually at the 1st target level, before moving your stops to breakeven on the rest?

    It has been a good 2007 so far for the method – is the current 180 pip average per month consistent with the method’s backtest?

  • ChowClown

    Hi Pip Surfer, from your commentary you appear to scale out of profitable trades around the target zones, depending on whether price makes a clean break through the level, or not.

    What percentage of your ‘stake’ do you take off usually at the 1st target level, before moving your stops to breakeven on the rest?

    It has been a good 2007 so far for the method – is the current 180 pip average per month consistent with the method’s backtest?

  • PipSurfer

    pipcious- I wait until a trend change has COMPLETELY formed on the 4hr chart before looking for trades in that direction. This means that I wait until the CLOSE of the 4hr chart before determining whether a new trend has been formed. Once I establish the trend, I only look for trades in that direction until a new trend change candle is formed.

    Brain- I’m glad you are finding this blog useful. The purpose of this blog is to help you compare your charts to mine and see if they match or are very close. I do make mistakes sometimes but for the most part, if you are getting trades different than mine, there may be something you are doing wrong. Regarding your trade, I did not have a moving average crossover and my RSI was less than 50, which is why I had no entry. Don’t worry if you’re not always right in the beginning. It takes time and practice, but you should get the hang of things in no time. Happy trading!

    Soap- I am using an exponential MACD with the settings of 12,26,9. My MACD shows the difference between the 2 MACD lines. I know you are not the only one with this problem, so I would suggest you visit the Cowabunga Thread in our forums (under “Free Forex Trading Systems”) and ask some of our other Cowabunga Traders. Hope that helps a little bit.

    Chowclown- I usually scale out half of my position at the first target. It’s rare that we’ll see the price hit 3 target ranges because we are looking at a very short term trading system, which is why I do half and half. All the stats on the Cowabunga System are from live forward testing. While I do like to backtest historical data, I believe forward testing is the most reliable and have been forward testing this system for over a year before I even started posting it. From my personal data, 180 pips per month is about right.

    Thanks for the comments everyone and happy trading!

    -PipSurfer

  • PipSurfer

    pipcious- I wait until a trend change has COMPLETELY formed on the 4hr chart before looking for trades in that direction. This means that I wait until the CLOSE of the 4hr chart before determining whether a new trend has been formed. Once I establish the trend, I only look for trades in that direction until a new trend change candle is formed.

    Brain- I’m glad you are finding this blog useful. The purpose of this blog is to help you compare your charts to mine and see if they match or are very close. I do make mistakes sometimes but for the most part, if you are getting trades different than mine, there may be something you are doing wrong. Regarding your trade, I did not have a moving average crossover and my RSI was less than 50, which is why I had no entry. Don’t worry if you’re not always right in the beginning. It takes time and practice, but you should get the hang of things in no time. Happy trading!

    Soap- I am using an exponential MACD with the settings of 12,26,9. My MACD shows the difference between the 2 MACD lines. I know you are not the only one with this problem, so I would suggest you visit the Cowabunga Thread in our forums (under “Free Forex Trading Systems”) and ask some of our other Cowabunga Traders. Hope that helps a little bit.

    Chowclown- I usually scale out half of my position at the first target. It’s rare that we’ll see the price hit 3 target ranges because we are looking at a very short term trading system, which is why I do half and half. All the stats on the Cowabunga System are from live forward testing. While I do like to backtest historical data, I believe forward testing is the most reliable and have been forward testing this system for over a year before I even started posting it. From my personal data, 180 pips per month is about right.

    Thanks for the comments everyone and happy trading!

    -PipSurfer